The U.S. Securities and Exchange Commission (SEC) is reportedly considering dropping its lawsuit against Coinbase, a move that could mark a turning point in the regulatory landscape for cryptocurrency. The Commission has requested 30 days to review the exchange’s appeal, signaling a potential resolution to one of the most significant legal battles in the crypto industry. This follows the SEC’s recent decision to pause its lawsuit against Binance, indicating a broader shift away from aggressive enforcement actions under Chair Gary Gensler’s leadership.
SEC’s Case Against Coinbase Nears Resolution
The lawsuit, filed in 2023, alleged that Coinbase was operating as an unregistered securities exchange and needed to comply with traditional financial regulations. The case became a cornerstone of Gensler’s crackdown on the crypto industry, emphasizing the SEC’s stance that digital assets should be regulated similarly to stocks and bonds. However, recent developments suggest that the Commission is reconsidering its approach.
According to the Wall Street Journal, Matthew Sigel, Head of Digital Research at VanEck, cited a Citigroup representative who expects Coinbase’s litigation with the SEC to be “wholly or partially rescinded.” If this materializes, it would be a significant win for Coinbase and the broader cryptocurrency sector.
Coinbase’s Strategy and Political Influence
Coinbase has actively fought the SEC’s allegations through legal appeals and countersuits, while also leveraging political connections. The exchange has been a key supporter of Fairshake, a pro-crypto Super PAC, and CEO Brian Armstrong has built relationships with policymakers, including President Donald Trump. With Trump’s return to political prominence, regulatory sentiment toward crypto appears to be shifting in favor of industry-led frameworks.
What’s Next for Crypto Regulation?
While the SEC has not officially dismissed the case, its request for a 30-day review suggests that a resolution is imminent. If the lawsuit is dropped, Coinbase could play a leading role in shaping future crypto regulations tailored to the industry’s needs.
Also Read : Coinbase Adds PENGU & POPCAT, Sparking Price Jumps and Surge in Trading Volume
With momentum favoring the crypto sector, this potential regulatory shift could pave the way for increased institutional adoption and a more favorable business environment for exchanges and digital asset companies.
Disclaimer: The information in this article is for general purposes only and does not constitute financial advice. The author’s views are personal and may not reflect the views of Chain Affairs. Before making any investment decisions, you should always conduct your own research. Chain Affairs is not responsible for any financial losses.
